2. Mortgage Points Deduction
When we decide to purchase a home, we will most likely face ‘mortgage points.’ Uncle Sam sees these points as deductible, but you must meet certain criteria like the loan you take must be secured by your main house.
If you’re actually at your second home, you will not be entitled to deduct the mortgage points in the same year you pay them. However, you can deduct them gradually within the loan period.
In case you refinance, you can also deduct the points. But if you do it for the second time with the exact same lender, you actually add those points to the previous ones. And, yes, you’ll have to deduct them gradually as well.
No matter how you want to deduct those mortgage points, you’ll have to itemize in order to claim your deduction.
